People’s United Bank acquisition wins federal approval

HBJ Photo | Joe Cooper People's United Bank at 1 Financial Plaza in downtown Hartford.

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By Zachary Vasile

The Federal Reserve on Friday approved M&T Bank’s acquisition of Bridgeport-based People’s United Bank, setting the stage for the $7.6 billion transaction to officially close.

In a statement explaining its decision, the Federal Reserve said the partners meet the standards for approval, with both banks being well-capitalized and well-managed. Regulators also said the deal would not harm competition or give the combined business an unfair share of the regional market.

“Based on all the facts of record, the board concludes that consummation of the proposal would not have a significantly adverse effect on competition or on the concentration of resources in the New York City market or in any other relevant banking market,” the statement said. “Accordingly, the board determines that competitive considerations are consistent with approval.”

The acquisition, first announced in February 2021, was expected to close by the end of last year, but an apparent delay at the Federal Reserve prompted M&T officials to push back their prospective closing date to Feb. 21. After that deadline was missed, the bank extended the “window” in which the deal might be completed to June 1.

The Federal Reserve’s message did not comment on what might have caused the delay.

Some analysts had speculated that regulators could be reviewing bank mergers more carefully under the administration of President Joe Biden, who has spoken in favor of reforms he maintains would uphold competition and consumer choice in banking.

Even if a tighter standard is now being applied, however, the Fed gave no indication that it sees the M&T-People’s United deal as problematic.

Of the states in which M&T and People’s United both operate, Connecticut, Massachusetts and Vermont each impose a 30% limit on the total amount of in-state deposits that a single bank can control, officials said. The combined organization would control approximately 16.2% of total deposits in Connecticut, 1.7% in Massachusetts, 3.2% in New York and 24.3% in Vermont, keeping its market share below the regulatory threshold.

Both M&T, which has its corporate headquarters in Buffalo, and People’s United have already secured approvals from banking regulators in their home states.

M&T officials have said their first priority after federal approval will be systems conversion and integration work. People’s United’s current central office, in downtown Bridgeport, is expected to serve as a regional headquarters for M&T.